1.You are a cellular telecom operator with strong roots in the urban markets. Due to saturation in the existing markets, you now want to expand into rural areas. How would you modify your current marketing mix strategies according to the rural consumers?

2.Comment upon the effectiveness of wall paintings and the mobile vans as communication media in the rural markets, giving suitable examples.

3.Your company is a marketer of a popular washing powder brand for the last three decades. The company has been witnessing a decline in the sale during the last few years. The report given by the marketing research department has indicated that the entrance of spurious brands in the market is the major reason behind the decline in the sale. Being a marketing manager what measures would you take to increase the sale of the product?

4.What are the challenges involved in the distribution of products in the rural markets? What would you advise to the marketers of consumer durables to address these challenges?

• You are a cellular telecom operator with strong roots in the urban markets. Due to saturation in the existing markets, you now want to expand into rural areas. How would you modify your current marketing mix strategies according to the rural consumers?

The Services

The company has a developed mix of services targeting both businesses and consumers. At today's breakneck pace of business, companies need more ways than ever to keep in touch, and the easier the better.

Cellular Providers' innovative product and service offerings provide the best advantages to customers, including sleek and innovative cellular phone models, text and numeric paging, data capability, no roaming or landline connection charges, and much more.

The Market

The ten-year outlook in the wireless communications service is excellent. The number of new cellular subscribers in the United States increased dramatically from 1992 to 1998, and 1999 saw continuation of that growth. The number of new subscribers exceeded 10 million, with a record 11.5 million net new subscribers in 1997, for a total of 55.3 million at the end of that year. By the end of 1999 analysts had that figure reaching 80 million. While projections differ, the number of cellular and PCS subscribers in the U.S. is expected to have a compound average growth rate(CAGR) of 12%. With the evolution of new technology, this industry is expected to generate increased revenues.

There are a number of trends that are driving this growing industry. The most significant ones are greater marketing and advertising efforts, rapidly expanding networks, and technological advances. New services and applications such as advanced messaging, data and video transmission, location technology, and remote monitoring are in the early stages of what most analysts predict will be a period of explosive growth.

The company plans to focus on three target markets that will provide us with the greatest market penetration. This includes the specialty business users, the general business users, and the personal users. We intend to offer service packages that are priced appropriately for each segment and will offer the services that best suit each segment's needs.

Cellular Providers' ongoing marketing strategy involves the company maintaining and expanding a broad base of clients in target territories, establishing alliances with product and services companies so that it can deliver high quality products, and invoking its own organization to bring these together and implement total solutions for customers. The company will move from the traditional product-focused strategy to a total-focus on customer ownership.

Financial Considerations

It is estimated that Cellular Providers will have strong profits based on $10 million in sales by Year 3. Cellular Providers is currently seeking funding in the amount of $100,000 as a three-year loan for the purpose of increasing market share, opening up additional retail locations, hiring additional staff, and effectively advertising and promoting its services.

1.1 Objectives

Business Objectives

• Company growth. • Become established as the leading distributor of wireless communications services. • Increase number of retail outlets.

Cellular Providers is committed to continued high levels of customer service and selling cellular and two way radio service through progressive retail locations and outside sales representatives.

Cellular Providers is striving to become the nation's leading distributor of cellular service and accessories. Cellular Providers' vision capitalizes on technologically superior products and services and is designed to enhance business and personal communication.

1.3 Keys to Success

Timing is critical in business. Cellular Providers is taking advantage of an opportunity to become a highly distinguished and recognized industry leader because of certain key advantages:

• The management team has a unique combination of business knowledge and experience in this market. • Cellular Providers has combined its expertise to offer services for every type of customer in this credit-sensitive industry. • Cellular Providers has established partnering relationships with leading companies in the industry and customers.

Cellular Providers' critical success factors include funding, marketing, quality sales professionals, good management, aggressive branding, increasing reach, affiliating with the right partners, being specific to the needs of businesses and the public, competitive intelligence, appropriate use of technology, and remaining dynamic to keep pace with evolving wireless communications business strategies.

Services

The company has a developed mix of services targeting both businesses and consumers. At today's breakneck pace of business, companies need more ways than ever to keep in touch, and the easier the better.

Cellular Providers' innovative product and service offerings provide the following advantages to customers.

• A full range of sleek, modern handsets to choose from. • Text and numeric paging. • Data capability. • A full range of features. • A national network. • No roaming or landline connection charges. • One-second rounding after the first minute.

3.1 Service Description

Cellular Providers has created a niche market as a one-stop shop for wireless services. Additionally, Cellular Providers has professionals with over 10 years combined experience in the industry, sophistication, and sales and distribution channels that are successful. Our services are formulated with ingredients known to increase the quality of communications, enhance internal business communications, and give users the opportunity to access the latest technology such as the ability to access the Internet on their handset.

Cellular Providers maintains a number of different services and accessories. Each of these services and accessories can be placed at the growth phase on the product life cycle curve.

3.2 Competitive Comparison

Cellular Providers is well positioned as a significant player in the cellular and two-way radio service marketplace. There are varying degrees of competition in each area, ranging from a great deal of perceived competition to the very minimal competition in satellite dishes. New technology research and upgrades will be on the cutting edge to improve our product and service lines and ensure that Cellular Providers remains a leader in this field. In comparison to the other key industry players, Cellular Providers offers a greater complement of products and services that make it a truly one-stop shop for wireless communications services. Significant differences include these offerings: satellite dishes, specialty markets with a direct need, services from four different wireless service providers, and residual revenue from service lines.

3.3 Fulfillment

Cellular Providers is required to comply with various rules and regulations among a number of local, state, and federal agencies. Locally, the company is required to maintain its business license and comply with local regulations and city codes. From a State level, the company is required to comply with all State laws concerning employment law, corporate law, and consumer products regulations. From a Federal level, the company is required to comply with additional consumer product laws, taxation, etc.

Cellular Providers uses Quick Books for its accounting software; Accounting is system based on the accrual method. The fiscal year is based on year-end. Financial reporting methods include monthly, quarterly, and annual statements. An annual audit is to be performed by the firm's CPA firm in January.

Cellular Providers carries insurance for business liability, automobile, and medical coverage. Additional insurance programs such as worker's compensation and key-man coverage will most likely be consummated by the close of the second quarter of 2000.

Management has no knowledge of pending lawsuits or threat of legal action directed at either the company or its officers.

3.4 Technology

Cellular Providers' business tools may be considered to be those assets that keep the business running smoothly. These tools include computers, software, business forms, standard agreements, various internal process standards, and other company-specific documentation.

Estimated technological changes in this section concern those changes that would most likely affect Cellular Providers' ability to compete. As Cellular Providers' management identifies changing technology, these changes will be studied, analyzed, and evaluated. Of those technological changes that show significant impact on Cellular Providers' future, funds and resources will likely be committed to making adjustments to Cellular Providers' business operations. Actions include expanding sales, customer service, and training in order to meet the demand of the business community.

Market Analysis Summary

Cellular Providers continues to conduct industry analysis to stay current on the nature and dynamics of the industry. This process helps management develop insight and devise sustainable business and marketing strategies to assure future success and avoid making decisions based on blind assumptions. Cellular Providers' business model was developed under two areas of knowledge: understanding the industry, and by having worked for and observed successful companies(and their business models) in the wireless communications services industry.

According to reports published by CNN Financial News from the Commerce Department, the U.S. economy capped off 1999 at a furious pace, posting its fastest quarter of growth in more than three years, as demand at home and abroad for U.S.-made goods remained robust and companies spent more stocking their shelves.

Gross domestic product grew at a 6.9 percent annual rate in the fourth quarter, the Commerce Department said, above the revised 6.5 percent increase expected by economists and well ahead of the 5.8 percent pace originally reported a month ago. It was the biggest gain since the second quarter of 1996, and dwarfed the third-quarter expansion of 5.7 percent.

The GDP price deflator, a key inflation gauge, rose at a 2 percent annual rate, the same rate initially recorded a month ago and in-line with economists' forecasts of a 2 percent gain. The price deflator rang in at 1.1 percent in the third quarter. For the entire year, the U.S. economy grew at a 4.1 percent pace, while the GDP price deflator advanced 1.6 percent. Higher productivity has allowed businesses to produce more without increasing expenses, keeping the cost of the final product low.

The U.S. economy's rate of expansion during the past three years has been faster than what Fed officials have said can be sustained without a renewed inflation threat. Fed officials have stated at different intervals that a "comfortable" rate of growth is typically around 3 percent. Small businesses are taking advantage of the opportunities the Internet affords.

International Data Corporation(IDC) estimates that the number of small businesses engaged in e-commerce will increase 47.1% annually, from 400,000 at the end of 1998 to almost 2.8 million at the end of the year 2003, signaling the broad adoption of the Internet by these small enterprises. The widespread adoption of the Internet as a purchasing vehicle has created a wealth of opportunities for businesses that offer products and services to small businesses and consumers. Simultaneously, it has given both small businesses and consumers a wider variety of products from which to choose at competitive prices.

4.1 Target Market Segment Strategy

Cellular Providers sources of revenue are derived from the sale of wireless communications services to businesses and consumers, the sale of accessories, and co-brands(revenue sharing). In comparison to other start-up companies of recent years, Cellular Providers has done very well.

4.1.1 Market Trends

The most significant trends are greater marketing and advertising efforts, rapidly expanding networks, and technological advances. New services and applications such as advanced messaging, data and video transmission, location technology, and remote monitoring are in the early stages of what most analysts predict will be a period of explosive growth.

4.1.2 Market Growth

Current economic conditions driving Cellular Providers' industry sector include a rising GNP, interest rates edging up gradually, communications economy that is growing, and an increasing number of consumers with greater amounts of disposable income. The savings rate has begun to rise as well. Warning signs of change include rising interest rates and inflation. If these begin to rise sharply, it signals a faltering economy and can have negative effects on all business including Cellular Providers.

The ten-year outlook in the wireless communications service is excellent. The U.S., Department of Commerce estimates that billions are invested each year for research and development. The number of new cellular subscribers in the United States increased dramatically from 1992 to 1998, and 1999 saw continuation of that growth. The number of new subscribers exceeded 10 million, with a record 11.5 million net new subscribers in 1997, for a total of 55.3 million at the end of that year. By the end of 1999 analysts had that figure reaching 80 million. One analytical firm believes that 82 percent of U.S. adults from households with an income higher than $35,000 per year(approximately 90 million people) will be subscribers by 2002. While projections differ, the number of cellular and PCS subscribers in the U.S. is expected to have a compound average growth rate(CAGR) of 12%. With the evolution of new technology, this industry is expected to generate increased revenues.

The explosive growth of the Internet, as a tool for global communications, has enabled millions of people to interact electronically. IDC estimates that there were 142 million Web users worldwide at the end of 1998, and expect this number will grow to approximately 502 million by the end of the year 2003. Rapid acceptance of the Internet as a communications platform by both businesses and consumers has created the foundation for significant growth in business-to-business and business-to-consumer e-commerce. The cellular and PCS industries continued to attract more non-business users largely as a result of a decline in the cost of handsets and bundled service packages. Additionally, it is seen as fashionable to have a handset while driving or interacting with others.

4.2 Market Segmentation

According to the Cellular Telecommunications Industry Association, industry investment grew to $46 billion in 1997, up over 41% from 1996. Dataquest estimates that the average annual revenue per subscriber for PCS was $576 in 1997, with total revenue for 1997 at $1.03 billion, over 3% of the combined total for cellular and PCS.

By 2001 there are expected to be about 40 million U.S. PCS subscribers, and total revenue for the year of $15.9 billion, according to Dataquest. Other predictions vary: Decision Resources forecasts that PCS will account for only 21.8%(19.5 million) of U.S. mobile voice subscribers, while cellular will account for the remaining 78.2%(70 million) by the end of 2001, but estimates total revenues will reach $31.4 billion. On average, however, it is projected that PCS subscribers will account for 40-45% of subscribers and about half of total service revenues by 2002.

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4.3 Competition and Buying Patterns

Effective competitive strategies are built upon understanding what defines and determines if another company is a competitor. Cellular Providers does not believe that all cellular and two-way radio service firms compete with it because many of these do not provide the array of services that it provides. The number of companies selling cellular services continue to grow and each competes for a share of the market. This translates into escalating advertising costs especially with larger and established companies. This trend is expected to continue and intensify over the coming years.

Within the U.S., there are numerous companies that provide one or more types of communications services. According to U.S. Trade and Outlook '99, there were more than 1,500 cellular systems operating in 750 U.S. markets. Far fewer provide the depth, breadth, and level of expertise as that of Cellular Providers. Globally, as in the U.S, there are companies that offer wireless communications services. Few carry the range of services as that of Cellular Providers.

Cellular Providers developed its sales and marketing strategy by analyzing its own internal strengths and then analyzing current market conditions. This process helped Cellular Providers create its marketing and sales strategy to leverage its competitive advantages with a unique marketing strategy, thus establishing it as the nation's leading wireless communications service provider for businesses and consumers.

The company will create momentum through critical mass and brand recognition. Cellular Providers will monitor the effectiveness of its marketing efforts in order to determine the advertising return on investment and the commerce generated from the various channels.

Cellular Providers' ongoing marketing strategy involves the company maintaining and expanding a broad base of clients in target territories, establishing alliances with product and services companies so that it can deliver high-quality products, and invoking its own organization to bring these together and implement total solutions for customers. The company will move from the traditional product-focused strategy to a total-focus on customer ownership.

The overall marketing plan for Cellular Providers' service is based on the following fundamentals:

• The segment of the market(s) planned to reach. • Distribution channels planned to be used to reach market segments: retail outlets, sales representatives, and telemarketing. • Share of the market expected to capture over a fixed period of time.

Our year 2000 marketing goals include the following:

• Capture 5% market share of businesses in the Idaho and Washington market areas. • Capture 1% market share of consumers in the Idaho and Washington market areas. • Develop market share for satellite dishes and equipment. • Educate businesses and consumers about services provided. • Substantially increase sales over 1999 levels. • Position the company as the number one provider of solutions to wireless communications. • Make a major branding effort emphasizing Cellular Providers' name and array of services. • Initiate new marketing program with a budget of $240,000. • Create new collateral marketing materials(brochures, radio ads, video). • Media placements including magazine, TV, radio, Internet, print, and banner advertising. • Expand product and service offerings. • Provide sales reps with free demo systems.

5.1 Pricing Strategy

Cellular Providers' retail prices are competitive and affordable for businesses. The company has also established a pricing and commissions structure for sales representatives and distributors. Bulk purchasing enables the company to reduce its cost of goods sold, increase revenue, and pass on the savings to businesses and consumers.

5.2 Promotion Strategy

Cellular Providers' overall goal is to generate additional retail traffic, increase the business and consumer base, and create more awareness to the need for this type of service in the marketplace. Currently, marketing efforts have revolved around sales representatives and telemarketing.

During 2000, Cellular Providers' marketing goals also include positioning the company for co-branding alliances with several industry leaders. It is Cellular Providers' belief that the best way to introduce its services to businesses as well as consumers is through aggressive telemarketing.

Cellular Providers' marketing propositions are designed to appeal to various target audiences, regardless of their level of sophistication. Cellular Providers will continually inform businesses and consumers through press releases and media placements about the service benefits as well as endorsements from other customers.

These two factors naturally create a curiosity from those not previously exposed to Cellular Providers services, as well as the public sector seeking improved methods in cellular service deals. Overall, this is intended to encourage further investigation by businesses and consumers and is precisely the result Cellular Providers seeks. It is believed that this strategy will draw an abundance of curiosity from which a substantial market can be developed.

As an extra incentive for customers and potential customers to remember Cellular Providers' name, the company plans to distribute advertising specialties with the company logo. This will be an ongoing program for the company, when appropriate and where it is identified as beneficial.

The objective of incentives is to portray Cellular Providers' goals and products as an attractive functionality. It is also to show customers how to use the latest in technology as it relates to wireless communications services.

5.4 Strategic Alliances

Cellular Providers has strategic partnerships with the leading companies industry. Management feels that these partnerships will enhance sales and help build critical mass and business momentum. The partnering companies are given below.

• AT&T; • Sprint PCS.

When Cellular Providers agrees to accept a new client, it is accepting a new business partner. Plans are underway to further strengthen relationships and establish other relationships as the need arises in the future.

5.5 Competitive Edge

Activities contributing to company success include identifying emerging trends and integrate them into Cellular Providers' operations, respond quickly to technology changes/be there early, provide high-quality services, continue to invest time and money in marketing and advertising, continue to expand into specialty markets, and stay ahead of the "technology curve."

Our future is highly dependent upon measuring resources we need in order to execute our plans and be competitive. Our method includes qualitative and/or quantitative measurements of competition and by estimating our own company growth, sales, and cash flows.

Our resources are also measured in terms of people, equipment, financial, and critique to see if the resources fit are adequate for the situation. Resources are available as needed to meet the technology curve. In general our strengths include business management, accounting and finance, knowledge of the wireless communications services industry, and experience in running successful businesses in the past.

Cellular Providers prides itself on its high-quality customer service. Although excellent customer service is expected, not all provide this. Cellular Providers is available at all times for customer orders and inquiries.

108443 views The PhoneDog - Updated: from 2006 | More by this editor Fixed Monthly Cost

While only some major carriers offer "no contract," pre-paid cellular service, almost all of them offer fixed monthly cost plans as their preferred terms of service. Pre-paid plans offer the flexibility of paying only for the minutes you actually use, but carriers make the average cost-per-minute much lower on monthly plans to drive consumers towards fixed contracts. Fixed monthly contracts require a minimum one- or two-year commitment from the consumer to the carrier. In return, the consumer gets a lower average cost-per-minute as well as other perks often including discounted or free handsets and accessories, free nighttime and/or weekend service, and discounted add-on services including multi-line "family plans," and messaging and data plans.

Most consumers looking for new cellular service these days will opt for a fixed monthly plan. The major carriers all offer multiple plans with varying numbers of monthly minutes at different price points. When choosing a monthly plan, take the time to ask questions before signing a contract to insure that you understand all of the terms of the deal. For instance, some carriers offer free weeknight minutes beginning at 7 pm while others don't start until 9 pm. Some carriers offer free mobile-to-mobile calling within their network while others offer free calls between any mobile handsets(i.e. You can call a Verizon customer for free even though you have Cingular).

Also, be sure to find out what overage charges(when you've used more than your alloted monthly minutes) and early termination charges(when you want to cancel your service before the one- or two-year term has expired) are. There's virtually no way to sign a contract without agreeing to these charges, but some carriers make them heftier than others.

Two year contracts

Signing a two-year contract will often get you a better deal up front on a new handset or other equipment. Some carriers will even offer a slightly better monthly rate on a two-year contract over a one-year term. While one-year contracts used to be the norm, more and more carriers are now pushing two-year contracts as fixed monthly subscribers are the bread-and-butter of their businesses. Free Phones

Carriers usually offer a choice of free and discounted phones with the signing of a new service contract. Rarely do major carriers offer the newest state-of-the-art phones for free, though you will see the occasional promotion offering a hot new phone for free or close to free(generally with a two-year contract only).

Independent cellular dealers are more apt to offer top of the line phones for free or lower cost than corporate stores are. However, independent dealers do sometimes add additional charges for tax on the retail price, SIM cards, and so on which make those "free" phones wind up costing upwards of $50 - 75.

Upgrading Phones

Carriers will usually offer an upgrade path to customers who have completed their initial contract term and are willing to sign a contract extension of one year or longer. Upgraded phones are rarely as inexpensive as when the same handset is purchased with a new service contract, but carriers can sometimes be talked into offering better upgrade deals if they sense a customer is ready to leave for a different carrier in order to get a good deal on a new phone. If you're in the market for a phone upgrade, be sure to check ebay and other online marketplaces as well, as deals can often be had on new and lightly used equipment. Free Long Distance

Almost all major carriers now offer free long distance calls with fixed monthly plans. The norm nowadays is for carriers to charge for actual calling minutes, treating local and long distance calls the same so long as the calls are within the Continental United States. Some regional carriers do charge extra for long distance calls - particularly those carriers offering "unlimited local calling" under fixed monthly plans - so be sure to read the fine print if you plan to use a regional carrier to place long distance calls. Unlimited Nights and Weekends

In lieu of cutting monthly fees even further, many carriers now offer unlimited nights and weekends as incentives under their fixed monthly plans. This means that any cellular calls made or received during these times won't count against your monthly allotment of minutes. Nights and weekends start and end at different times from carrier to carrier, so be sure to check your contract lest you start making "free" calls that actually eat up your minutes. Nights generally start at 7pm or later, while weekends can from Friday evening or Friday midnight until sometime Sunday night.